Google Apps vs. Microsoft Office 365: Both Clouds Win Fortune 500?

Written by The VAR Guy 1
July 19, 2013

Google and Microsoft each claim their cloud platforms now serve more than 50 percent of Fortune 500 businesses. But which is ultimately more popular: Google Apps and App Engine or Office 365 and Windows Azure? Here's some educated guesses.

Within minutes of one another, Microsoft (MSFT) and Google (GOOG) yesterday made similar claims about their respective cloud computing businesses. During earnings calls for each company, Microsoft and Google each said more than half of all Fortune 500 companies now use their respective cloud platforms. But what exactly does such a claim mean — especially for channel partners who want to participate in that momentum?

First, let’s start with the statements:

Microsoft CFO Amy Hood said Office 365 now has a $1.5 billion annual revenue run rate. Plus, Windows Azure is now used by more than 50 percent of Fortune 500 companies, she added. But that positive cloud news was overshadowed by Microsoft’s Surface RT sales train wreck, which triggered a $900 million writeoff.
Google Chief Business Officer Nikesh Arora said Google Apps for business and the search giant’s other enterprise services are now used, on a paid basis, by more than50 percent of Fortune 500 companies.

Teaser Alert

In fact, The VAR Guy’s sister site — Talkin’ Cloud — has determined that both Google and Microsoft rank among the world’s top 10 cloud services providers. A full report — the third-annual Top 100 Cloud Services Providers list — will debut July 30 with the details.

Remaining Questions

In the meantime, who has a leg up in the enterprise cloud market — Microsoft or Google? It’s difficult to say since:

Neither Microsoft nor Google will say exactly how much their recurring cloud business revenues are each quarter.
Google says it now has more than 6,000 channel partners but it sounds like a handful of partners — Cloud Sherpas, Excel Micro, SADA Systems and more — dominate the Google Apps partner program.
Microsoft says it now has more than 150,000 cloud-enabled channel partners. But the company has not disclosed how many partners are selling significant Office 365 seats each month.

Which company ultimately generates more cloud-related revenues from enterprise and small business customers? Talkin’ Cloud’s Top 100 CSP report will reveal the answer on July 30.